Despite strategy shift, Raiffeisen still looks to retail for returns
The local unit of Austrian-owned Raiffeisen Bank isnʼt "turning its back" on its retail clients in spite of a strategy shift announced in 2015 to cut staff and focus on corporate clients and electronic channels, CEO György Zolnai said in an interview with business daily Világgazdaság published on Monday.
Zolnai acknowledged Raiffeisen had scaled back its network in Hungary, halving it to 70 units, but noted that the lender remained one of the countryʼs biggest universal banks, according to a summary of the interview published by state news wire MTI.
"I think that even though weʼre running one of Hungaryʼs best private banks, we canʼt just turn our backs on the retail division, because in the present interest rate environment strong retail lending can still ensure an expansion of business volume and a good return," the chief executive said. "Thatʼs why we are concentrating on home loans and uncollateralized loans now. This year, the bank has shown a 130% growth rate in this segment," he added.
As reported by the BBJ in March, Raiffeisen Bankʼs after-tax profit doubled to HUF 15.7 billion last year on lower risk and operating costs. The bankʼs stock of non-performing loans dropped more than 40% to HUF 133 bln.
Corporate division head Ferenc Kementzey said at that time that the corporate lending stock, excluding NPLs, was up 20% and the lenderʼs new SME outlays increased by 13%.
At the same time, retail division chief Ralf Cymanek said the bank is still among Hungaryʼs top three with more than 32,000 clients.
In August, Raiffeisen was also certified by the National Bank of Hungary (MNB) to offer "consumer-friendly" home loans.
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.